NEW YORK — Shares of AppLovin Corp. (NASDAQ: APP) could climb another 40 percent over the next 12 months if bullish Wall Street projections pan out, according to several recent research notes reviewed by SourceRated. The mobile-marketing technology firm has already gained roughly 160 percent in the past year on the back of surging demand for its advertising optimization software, but the latest price-target revisions highlight a widening gap between optimists and skeptics.
Bank of America on Monday lifted its 12-month target to $88 from $70, implying about 38 percent upside from Monday’s close, while Jefferies raised its target to $90. Both brokerages cited accelerating revenue from AppLovin’s machine-learning platform, Axon, which delivers targeted ads inside mobile apps. “We believe Axon 2.0 meaningfully expands the addressable market,” Bank of America analysts wrote.
AppLovin went public in 2021 at $80 a share, only to tumble below $20 during the 2022 tech rout. A cost-cutting program, a pivot away from in-house game development and a rebound in digital-ad budgets have since revived sentiment. In February the Palo Alto-based company reported fourth-quarter revenue of $953 million, up 35 percent year on year, its fastest growth in six quarters. Net income swung to a $114 million profit from a loss a year earlier.
Still, some analysts warn that comparisons will toughen later this year. “A lot of the easy gains are behind them,” said a portfolio manager at a large New York hedge fund who asked not to be named because he is not authorized to speak publicly. He pointed to increased competition from Unity Software and Alphabet’s AdMob, as well as privacy changes in Apple’s iOS that could hamper user-tracking models.
Industry researcher eMarketer expects global mobile-advertising spending to rise 13 percent in 2026, down from 17 percent growth last year, suggesting a slower but still expanding backdrop. AppLovin executives told investors in February that they will invest “aggressively but responsibly” in generative-AI tools to keep conversion rates high.
Whether those bets translate into a fresh leg higher for the stock may hinge on the company’s ability to sustain 30-plus-percent revenue growth while protecting margins, analysts said. Investors get their next update on May 8, when AppLovin is scheduled to report first-quarter results.
Correction: An earlier version of this story misstated the date of AppLovin’s IPO. It occurred in April 2021.